Picture of Hong Kong
WE International has set up a Hong Kong office

Case study: WE International

Investing in planning and replenishment

Written by Joe Devo

"What you see in most fashion companies is that buying has always been very strong and has a strong influence, and the buyers in large part dictate the way the collection is designed and bought,” says Roel Brand, IT director of WE International, a European fashion giant that makes more than 60 per cent of the underpants sold in The Netherlands.

“The modern demand is to become more customer-oriented and responsive, which H&M and especially Zara have shown can be a successful business model, putting a higher demand on collaboration, not only as a retailer with the producers, but also internally.”

The WE response has been to put a buying office into Hong Kong, close to its Chinese suppliers, and to provide these buyers with access to a wide area network, through which they can view the company’s product data management environment.

“This means they can look in detail at the orders and the quantities and qualities that we require and do the quality checks before the goods leave for Europe,” says Brand.

“We have some pilots where we come close to what they call vendor-managed inventory, but it is early days. We are also having a pilot for the replenishment of our warehouse, so we are never out of stock.”

The chief area in which WE is already reaping the rewards of investment is in planning and replenishment strategies. The latter comes courtesy of a system from Viva Cadena and the former through i2 Technology’s planning software, which Brand says has given a beneficial overview of the business’s buying needs. Less, it would appear, is more.

“We basically look at the sales potential by store and aggregate that at a level where you can give direction to the buying decisions. So we have a top-down process for the buyers where we can take the fashion trends into consideration, and we have a bottom-up process from the sales side where we can look at the missed opportunities and the potential on a store-by-store level. Because we trade in six different countries, you can imagine that demand patterns are slightly different on a country-by-country basis, and sometimes on a region-by-region basis.

Having the ability to aggregate the individual store potential via a single European view, while offering a European buying view on how to put a collection together for the next season, gives us a very consistent approach,” says Brand.

“What we see is that we are running less options with more volume. It hasn’t helped with picking the right products, as that is still the trick, but if we have the right product in-house, we can now maximise sales better. Because we have a more narrow collection, we make a clearer statement to our customers and our proposition in the marketplace becomes clearer.”

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